The Company and its Investors
In order to grow, companies must have capital. Investors and entrepreneurs are complementary pairs acting for their own interest and the ultimate survival of the business.
Investors: The Business Lungs?
The Need for Capital
A company needs money to buy machines or patents to grow. When it cannot be self-financing, it calls on outside people to lend this capital, influencing the life of the company.
Investor Expertise
Investors use years of experience to invest effectively, acquiring knowledge concerning initiation, weak/strong signals, risk-taking, and the financing ecosystem.
Requirement for Transparency
Investors only agree to lend if the company is in good health. Companies must regularly present financial documents showing potential for reimbursement or dividends.
The Quest for Profitability
Competition on the capital market means investors choose companies with the highest remuneration. However, over-promising high short-term returns can endanger long-term survival.
How to Get Capital from Investors?
1. Bank Borrowing
The company presents a development project and financing needs. To prove repayment capability, a series of documents on financial health and expected revenue are provided.
2. Financial Markets (Bonds)
Issuing bonds follows the same principle as a loan. The business borrows from individuals or institutions and repays the amount along with interest.
3. Financial Markets (Shares)
By issuing shares, those who lend money become owners. They receive dividends and have a say in the company’s operation as shareholders.
4. Equity Investment (BSA-AIR)
A flexible participation mode allowing young startups to obtain financing quickly via “Rapid Investment Agreement Share Subscription Warrants.”
Different Types of Investors
From individuals to massive state funds, here are the key players in the ecosystem:
Crowdfunding
Online platforms that finance creation, takeover, or development. Often used in addition to bank loans or honor loans.
Business Angels
Natural persons investing personal assets and expertise in promising projects to generate added value.
Sovereign Wealth Funds
State-held investment funds managing national savings to achieve macroeconomic objectives and GDP diversification.
Private Equity Funds
Professional funds raised to invest in securities, real estate, or venture capital in unlisted companies.
Public/Private Holdings
Companies taking financial participations in sectors as diverse as defence, energy, transport, and services.
Corporate Ventures
Investment structures owned by large industrial groups seeking to promote innovative technologies that solve specific problems.
